Silver Hill taps underserved market with residential-style approach

MORTECH 2000 provides technology prospectus and retrospectivemortgagepress.comMORTECH 2000, technology survey, lender Web sites "The discrepancy between what technology providers and the financial media are pushing and covering, and what mortgage lenders actually want, is widening," says MORTECH founder and chief analyst, Jeff Lebowitz. According to Mr. Lebowitz, the MORTECH 2000 sampling indicates that a majority of the 358 mortgage lender survey participants in the study are currently "unprepared" for many of the new technologies and services most widely covered by the mortgage industry news media, including contract loan processing and risk management services, wireless Internet access, automated valuation models, and Extensible Markup Language (XML). By contrast, 81 percent of the MORTECH mortgage lender participants have not only embraced automated underwriting standards, but also use it. The MORTECH 2000 survey team focused on the opinions of the "heads of residential mortgage lending" of its participants. The survey reveals that 70 percent of the respondents had no knowledge of what XML is. However, 60 percent of lenders now have a Web site in place, and loans originated from the Internet are doubling every year. "Lenders are taking the inherent power of the Internet seriously," says Mr. Lebowitz. "There has been a 30 percent increase in the number of Web sites put up by MORTECH survey respondents in the past year. Lenders of all sizes now are implementing Web sites, not just the industry giants. While lenders are investing in their proprietary Web sites, their interest in and use of multi-lender origination networks has all but dried up." According to the MORTECH 2000 survey, the average expenditure on Internet technology has increased 70 percent from 1999 to 2000 to just over $500,000. Web site functionality has deepened, moving far beyond "brochureware" publishing. "We are seeing growth in the breadth and depth in lenders' use of Internet technology," continues Mr. Lebowitz. "Until now, lenders have had static Web capabilities, posting only company and product information on their sites. In just one year, the number of transactional sites (having at least the ability to prequalify borrowers) increased 60 percent to nearly 600." Mortgage lenders are using the Internet more fully, even as they expand their branch distribution networks. Lenders view their branches as the primary way to increase loan production. At the same time that they are building branches, loans closed from applications originating on a Web site doubled last year to an estimated $65 billion. "Lenders are very conservative in their expectations from new technology," Mr. Lebowitz observes. "We are seeing very low adoption rates of technology innovations such as XML, wireless and electronic mortgage trading exchanges. Use of leading-edge technology is following the same measured pattern we found in the way lenders are implementing the Internet." The MORTECH 2000 survey is based on 358 interviews of senior mortgage company managers completed between December 2000 and February 2001. The survey is designed to provide data that statistically represents the attitudes and behavior of lender segments of all sizes. For more information, visit www.mortech-llc.com.